Headlines

Federal student debt lending swells, as does number of loan delinquencies

U.S. student-loan debt rose by $42 billion, or 4.6%, to $956 billion in the third quarter, the Federal Reserve Bank of New York said Tuesday. Overall household borrowing fell during that period.

Payments on 11% of student-loan balances were 90 or more days behind at the end of September, up from 8.9% at the end of June, a rate that now exceeds that for credit cards. Delinquency rates for all other consumer-debt categories fell or were flat.

Nearly all student loans—93% of them last year—are made directly by the government, which asks little or nothing about borrowers’ ability to repay, or about what sort of education they intend to pursue…

Unlike most other types of consumer credit, student debt is extremely difficult to discharge in bankruptcy. After falling behind on payments, a borrower typically finds it harder to obtain other types of consumer loans, or can only do so at higher interest rates.

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

-Recent generations have been strongly encouraged to attend college as the only way to get a job / continue their middle class existence.
-Said young people apply and attend colleges in great number at the naieve age of ~18 years old with little guidance. With the increased demand and the knowledge that people are willing to pay almost anything to “guarantee” future success, tuition prices skyrocket.
-Laws get passed, for whatever reason, that make student loans impossible to deal with in bankruptcy.
-Through no fault of their own the economy tanks and no one is willing to hire younger age groups for anything resembling a reasonable wage.
-The generation largely responsible for both the housing and higher education bubbles then begins to deride younger people for being useless idiots.

Right, and then you look at who the largest voting group is, and who makes up the majority of the government.

RINO on November 28, 2012 at 1:41 PM

So baby boomers forced Social Security down America’s throat? Most people didn’t want it. Baby boomers forced Medicare down America’s throat? How about all the other entitlements? ObamaCare? I think the blame lays with ideology and not age. Socialists have been working at this for nearly a hundred years and they’re about to see all their work come to fruitition … a “fundamentally transformed” America. Of course it won’t last long. Soon we’ll have riots and chaos like Greece.

The robbery is coming from all sides, the worst of which is Obamacare. Go to any job listing location and look at the number of temp jobs vs permanent jobs. A regular, permanent job is going to be a luxury — it pretty much already is. No one wants to deal with health benefits anymore.

But the difference is that the animous towards college kids and recent graduates seems largely restricted to the right.

But the difference is that the animous towards college kids and recent graduates seems largely restricted to the right.

RINO on November 28, 2012 at 2:06 PM

What’s your point? Most probably shouldn’t have gone to college to begin with. Most come out highly indoctrinated and unable to write much less speak coherently. Most have no idea of the history of the US and believe that everything liberal is good and everything conservative is bad. The indoctination is easily overcome by doing a modicum of research on their own but most don’t.

But the difference is that the animous towards college kids and recent graduates seems largely restricted to the right.

RINO on November 28, 2012 at 2:06 PM

Not everyone should go to college. Most people can’t afford to go to college. Look at the charts in the link I posted above. That is a huge bubble that is going to pop. $1T in liabilities.

Most people going to school study majors that provide zero productive value to society. They graduate with tens if not hundreds of thousands in debt and make coffee for you at $10/hr. I have a friend with 3 fine arts degrees and $120,000 in SL debt. He teaches high school. He will never be able to pay the loans off.

I have no source, just personal experience. Young people are by definition … young and inexperienced. Unfortunately the left has taken advantage of that. The left doesn’t want kids to succeed, or think freely and independently.

Don’t get me wrong, the reeducation of our kids needs to be an almost underground movement … but it needs to be done. Once unleashed younger people have the drive and innovation to possibly save what’s left of America.